LimitedCompanyTaxCalculator
Updated for 2026/27

Contractor tax calculator 2026/27

For limited company contractors: enter your day rate and working pattern to estimate company turnover, then see corporation tax, salary, dividends and personal take-home after all taxes.

Updated for 2026/27. Uses UK corporation tax, dividend tax and PAYE assumptions. Estimates only — not tax advice.

Calculate company tax Read the guides
Day rate to profitCorp tax 19%–25%Dividend extractionNet take-home
2026/27 tax year Company profit to personal take-home Salary plus dividends Retained cash shown

Limited company tax calculator

Company tax estimate

Adjust inputs below — results update instantly.

Tax year 2026/27
How do you want to enter company income?
£

Enter profit before director salary, pension contributions and corporation tax.

£

Annual profit used in calculations = monthly profit × 12.

£
£
Expenses exceed estimated turnover — check your inputs.
£
£
Expenses exceed estimated turnover — check your inputs.
£
£

Amount you plan to withdraw from available post-tax company profit.

Selected dividends exceed available post-tax company profit.
£
£
£47,874 personal take-home / year £3,989/mo
Personal take-home is based on salary and dividends withdrawn. Post-tax profit not withdrawn is retained company cash.
Monthly net
£3,989
Total tax
£18,325
Effective rate
24.4%
Personal take-home£47,874
Dividend tax£4,696
Employer NI£1,136
Corporation tax£12,493
Company pension£0
Retained company cash£8,801
Show detailed breakdown ▼
Director salary£12,570.00
Employer National Insurance£1,135.50
Corporation tax£12,493.04
Salary income tax£0.00
Employee National Insurance£0.00
Dividend tax£4,696.25
Retained company cash£8,801.46
Personal take-home£47,873.75
Effective tax rate24.43%
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HMRC 2026/27 · Methodology
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Quick answer

Tax calculator for UK limited company contractors 2026/27. Corporation tax, director salary, employer NI, dividends and personal take-home. Enter your day rate or profit.

Updated for 2026/27. Written and reviewed by James Whitfield against current GOV.UK and HMRC guidance · Editorial standards · Methodology. Estimates for planning only — not tax, accounting or financial advice.

Figures reviewed for the 2026/27 tax year (last updated July 2026). Source: GOV.UK.

About this calculator

Contractor tax calculator 2026/27: what it covers

This calculator lays out the full tax picture for a contractor operating through a limited company, rather than just the final take-home number. Contract income becomes turnover; you deduct allowable expenses to reach taxable profit; the company pays corporation tax on that profit (19% to £50,000, 25% over £250,000, marginal relief between). Only then is profit distributed, so the calculation stacks four separate charges: corporation tax, dividend tax, and National Insurance on any salary.

On a director's salary the company pays employer NI at 15% above £5,000, and you pay employee NI at 8% between £12,570 and £50,270 then 2%. Because single-director companies generally cannot claim the £10,500 Employment Allowance, the employer NI on a £12,570 salary is a real (though corporation-tax-deductible) cost. Dividends, drawn from post-corporation-tax profit, carry no NI but are taxed at 10.75%, 35.75% and 39.35% after the £500 allowance.

Allowable expenses reduce profit before all of this: accountancy fees, business travel and subsistence, equipment and software, use-of-home, professional indemnity insurance, and employer pension contributions. Getting expenses right lowers the corporation tax layer directly. Figures here are estimates for planning, not tax advice.

Common questions

Contractor tax calculator 2026/27 — FAQs

When does my contracting company have to register for VAT?
When VAT-taxable turnover exceeds £90,000 in any rolling 12-month period, or you expect to cross it within 30 days. Many contractors breach this quickly on a full-time day rate. Once registered you charge VAT on your invoices and reclaim VAT on costs, which most business clients recover themselves.
What is the Flat Rate Scheme and is it worth it?
The Flat Rate Scheme lets smaller businesses pay VAT as a fixed percentage of gross turnover instead of tracking VAT on every purchase, which simplifies bookkeeping. Contractors with few VATable costs sometimes kept a small surplus historically, but the 'limited cost trader' rules reduced that benefit. Whether it helps depends on your expenses, so compare both methods before joining.
Which expenses can a contractor claim against corporation tax?
Costs incurred wholly and exclusively for the business: accountancy and payroll fees, business travel and accommodation, computer equipment and software, professional subscriptions and indemnity insurance, a reasonable use-of-home allowance, and employer pension contributions. Each reduces taxable profit before corporation tax, so accurate recording directly lowers the 19%–25% charge.
How does inside-IR35 status change the tax picture?
If a contract is inside IR35, the fee is largely taxed as employment income through PAYE with employee and employer NI, rather than flowing through the normal corporation-tax-then-dividend route. That removes most of the dividend efficiency and changes which parts of this calculation apply, so identify each contract's status before modelling the company's tax.
Power tools

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Calculate how much profit is available for dividends 2026/27 after director salary, employer NI, company pension and corporation tax. Shows distributable pool clearly.
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See how much post-tax profit stays in your limited company after salary and dividend extraction 2026/27. Model different extraction levels and retained cash.
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Calculate a company director's net take-home pay 2026/27. Salary plus dividends minus income tax, NI and dividend tax. See your actual personal income after all taxes.
Practical guides

Limited company guides

Limited Company Tax in Scotland 2026/27
Corporation tax is UK-wide and unaffected by Scottish income tax. But directors taking salary and dividends are subject to Scottish income tax rates, which differ from rUK. This guide explains how.
Corporation Tax 2026/27: 19% to 25% Rates Explained
Corporation tax is 19% on profits up to £50,000 and 25% above £250,000 for 2026/27, with marginal relief (~26.5%) in between. See which rate applies to your company and how salary and pension choices change your bill.
Optimal Salary and Dividend Split for Directors 2026/27
How to calculate the tax-efficient salary and dividend combination for a limited company director in 2026/27, covering corporation tax, income tax, NI and the dividend allowance.
Director Loan Accounts Explained: Tax Implications for 2026/27
A director loan account (DLA) tracks money owed between a director and their company. This guide covers how DLAs work, when they attract tax charges, and how to manage them.
Limited Company Allowable Expenses: A Practical Guide 2026/27
What a limited company can legitimately deduct as business expenses, reducing corporation tax. Covers running costs, director expenses, travel, equipment, and home office claims.
Limited Company vs Sole Trader: Full Tax Comparison 2026/27
A detailed comparison of limited company and sole trader structures on net income, administrative complexity and risk. Includes worked examples at £40k, £60k and £100k profit levels.
Limited Company Tax Calculator UK 2026/27
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Calculate corporation tax 2026/27: 19% on profits up to £50,000, 25% above £250,000, marginal relief between. Enter profit after salary to see your exact bill.
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Calculate dividend tax 2026/27: £500 allowance, then 10.75% basic rate, 35.75% higher rate, 39.35% additional rate. Shows how salary and dividends interact.
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Calculate how much profit is available for dividends 2026/27 after director salary, employer NI, company pension and corporation tax. Shows distributable pool clearly.
AfterTaxSalary.co.uk
Use the PAYE salary tool when you want a pure employee baseline outside the company structure question.
EmployerCalculator.co.uk
Useful for isolating employer NI and payroll cost effects when director salary is the main planning variable.
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Relevant when household benefits planning sits alongside company extraction decisions.
HomeBuyingCosts.co.uk
Helpful once business take-home is being translated into a housing budget and buying costs plan.
Getting set up

Business bank accounts

A limited company must keep its finances separate from personal accounts. These accounts are free to open.

Starling Business
Permanently free, no monthly fee. A fully licensed UK bank - deposits up to £85,000 are FSCS protected. Accepts limited companies and sole traders. 0.7% on Post Office cash deposits.
Open an account →
Tide
Free to open. Built-in invoicing and expense tracking. 20p per outgoing transfer on the free tier (Tide Plus is £9.99/month). Funds are safeguarded as e-money, not FSCS protected. Usually has a new-account offer.
Open an account →
Mettle by NatWest
Free. Single-director limited companies only (max two owners, one account user). Includes FreeAgent bookkeeping at no extra cost. Funds are safeguarded as e-money, not FSCS protected. No cash deposits.
Open an account →
Registering at Companies House

Companies House now charges £100 to register a limited company online (up from £50 in February 2026). Same-day digital registration is £156. You can register directly at gov.uk or through a formation agent.